Debates of Nov. 25th, 1999

Municipal Grants Act

[Inky Mark, Reform, Dauphin—Swan River, MB]

Mr. Speaker, the member for Kootenay—Boundary—Okanagan has made many important points relating to Bill C-10.

Grants in lieu of taxes have been a thorn in the side of municipalities for many, many years. The question always raised by the municipalities has been why the federal government does not pay its taxes like all other Canadians.

There is no doubt the approach federal governments have used for the last 20 years is very divisive. It certainly does not bring Canadians together. My hon. colleague indicated that this approach basically creates situations where mayors of large cities are calling for their own special status, whether it be in the form of creating new provinces or new city states.

With the new millennium approaching, Canadians need a new way of dealing on a level playing field in how they are taxed. There is no doubt that the Municipal Grants Act tends to give the federal government special status in the area of paying property taxes to the municipalities.

I ask the member for Kootenay—Boundary—Okanagan, should the federal government give itself special status and how does it relate to the whole principle of equality in Canada?

[Jim Gouk, Reform, West Kootenay—Okanagan, BC]

Mr. Speaker, I thank the hon. member for his question. He raised a couple of important points, including the whole concept of special status. He asked if there should be special status for the federal government. No, there should not be special status for anyone.

During my speech I raised the Nisga'a treaty as an example. One of the biggest objections we have to the Nisga'a treaty is that it provides special status for some. The word equality is used all the time. We hear it used by both sides of the House, yet the government grants special status to the Nisga'a under the Nisga'a treaty. It grants special status to itself under Bill C-10. Now we can see where it is coming from when it had no problem with that aspect of the Nisga'a treaty.

There is an old adage about things that flow downhill. We know what that is and where the source is. There has been a lot of downloading. The federal government has downloaded a lot of costs for things onto the provinces. But the provinces are also taxing authorities so they keep it flowing downhill until it reaches the municipalities.

In their own respect, municipalities, towns and cities are also taxing authorities but they are extremely limited. They have no actual power. It is a delegated power, unlike that of the Nisga'a who have actual self-government that is entrenched in the constitution. Municipalities have only those powers delegated to them by higher authorities.

The government with this bill is saying it may pay or it may not, and because the government has power over the municipalities it will decide whether they get paid or not. It is extremely unfair for the biggest brother in Canada to download on the little brothers, the provinces, who then download on the non-status towns and municipalities throughout the country while saying it is transferring all of its costs downhill.

For the federal government to look good it passes it to the provincial governments. For the provincial governments to survive, having lost the money but which are still expected to provide the same services, they download some of it to the municipalities. Now big brother back in Ottawa is saying it is downloading but it may not, and in some cases likely will not, pay its share of the bill. When I say likely, and in some cases definitely, I mean Canada Post in particular. The mint is also in that category but it is somewhat isolated. Canada Post is all over the country, and for the government not to put it in schedule IV is an absolute download on municipalities and towns with no hope of their collecting.

It is a shameful thing when the government forces new costs on those small areas and then refuses to pay its bills.

[Rick Borotsik, Progressive Conservative, Brandon—Souris, MB]

Mr. Speaker, I appreciate the opportunity to speak to a piece of legislation that perhaps is not quite as sexy and certainly not as controversial as a lot of the legislation that comes before the House. However, it has a spot which is very close to my heart.

The bill deals with municipalities and the Municipal Grants Act, which now is going to be called the payments in lieu of taxes act. The reason I say it has a spot close to my heart is that as the majority of members in the House are aware, I came through the ranks of elected municipal officials. I had the opportunity and the great pride and honour to represent the city of Brandon as its mayor for three terms. Prior to that I sat on council for the city of Brandon for three terms.

Our caucus also has the distinction and honour of having a number of members who have also served honourably on municipal councils. The member for Saint John was a mayor of great renown. The member for Richmond—Arthabaska was a mayor of that community. The member for Compton—Stanstead was the mayor of that community. As well the member for Markham was a councillor of that municipality. There is a lot of experience among my colleagues with respect to municipalities, municipal requirements and certainly municipal issues.

This piece of legislation as was mentioned before has some good qualities to it. One of the thorns in the sides of municipal leaders all over this great country is the way the federal government looks down on municipalities and does not deal with them the way municipalities feel is right and necessary.

Even though I am standing in the House right now, I still believe very strongly that the grassroots of the first level of government is that of the municipal governments. It is accessible by its constituents. It has elected officials who are very close to the issues most important to Canadians where they reside. Canadians depend on that municipal level of government to provide them with services that are close to their needs and requirements in their homes, their municipalities and their constituencies.

Let us talk about some of those services. A municipal council and its elected officials are responsible for delivering the services that are so in need, such as sewer and water. It would be awful if we turned on a tap and nothing flowed. That is a municipal responsibility. Protective services, such as police, fire and ambulance, are needed on a daily basis by our constituents. They are provided by municipal councils. When garbage is taken away from our front steps and put in a landfill, it is the responsibility of the municipality. Roads, bridges and any other type of capital infusion or capital requirement at the municipal level are municipal responsibilities.

I mention these services because the only way a municipality can generate the revenue necessary to provide those services is through property taxes. They are services to properties and are paid for by property taxes. This is very important in this debate because property tax is levied on properties, whether they are apartment buildings, residential buildings, commercial buildings, single family homes, or buildings owned by the federal government.

Because municipalities are not recognized in the constitution, the federal government does not recognize taxation to municipalities. That is terribly arrogant.

Municipalities feel that they are better than that. They should first of all be recognized in the constitution as being a level of government, certainly not the first level because the federal government on the benches across the way feel that that is its right and due. There should be a recognition for municipalities.

Because the federal government does not recognize taxation as such and because it does not recognize the jurisdiction that is levying that tax, it has what is known as a grant in lieu of taxes. It is not a grant. It is a payment for services delivered to the property. In this proposed legislation it is changing it to payments in lieu of taxes. That is a little better, but why not just simply say taxes?

The normal process with respect to taxation is that everyone who owns property in jurisdictions and municipalities is assessed a taxable rate levied by the municipality. An assessment value is placed on the property by assessors, whether it be provincial assessors or municipal assessors. I as an individual have the opportunity and right to question that assessment. I have the right to go to a court of appeal, usually a municipal court or board of revision and question the assessment that is placed on my property. If I do not like that, then I go to the next level. In Manitoba it is the municipal board where I can then argue that the assessment is either right or wrong. If I lose at that level I can then go to the Court of Queen's Bench and argue that my assessment is out of whack.

The federal government however does not follow those rules. It simply says that it is arbitrarily going to change the rules and decide what the assessed value is on the property. Nothing changes in this proposed legislation to change that arbitrary distinction.

Mr. Speaker, I am splitting my time with the member for Madawaska—Restigouche. I understand that I have five minutes left.

As I was saying, the federal government does not have to follow the rules of the province of the jurisdiction where it is questioning that assessment. We could say that should be okay. The government in this bill has proposed an appeal board. From personal experience I can say that there is an arrogance at the bureaucracy level of the federal government.

I will give some examples where federal government officials decided that they did not want to pay the assessed value of a property. There was one instance in my municipality when I was sitting as mayor. The provincial assessors decided that there was a specific assessed value of a property of the federal government. Arbitrarily that value was reduced by 50%.

That is like someone with a residential property saying to the municipality, “I don't like the assessed value that you placed on my property. Therefore I am only paying half of what you are going to assess me in taxes”. Unfortunately there are remedies for that. The municipality could then say, “That is too bad. If you don't pay the whole amount, we will take your property in a tax sale”. The municipality cannot do that with the federal government.

Arbitrarily the government officials reduced the true value of the property to half of its level. We then had to go to an appeal panel. When I appeal assessments I like to look in the eyes of the people I am appealing to. The suggested approach at that time was to send a letter to the appeal panel that was going to be put in place by the federal government. There would be no opportunity to argue our position and the panel would make a decision. That is like appointing the judge, the jury and the executioner. There was no effective appeal.

The government has changed that now. It now has an appeal panel of 26 people minimum. Again they are approved and appointed by the federal government. Perhaps a lot of unemployed former Liberal MPs would like to find themselves sitting on that appeal panel, which I do not have a lot of faith at the municipal level of having an honest, fair and equitable decision being made. I am not happy about that area of the bill.

I am not happy that municipalities are not identified as a level of government. They provide more and better services than the federal and provincial levels.

Another thing I am not happy with is the way that the legislation has come forward.

As the mayor of the city of Brandon, I had the opportunity to sit on the board of directors for the Federation of Canadian Municipalities for some eight years. It is an organization that represents almost every municipality across the country. When the federal government brings forth legislation to put into place a very important aspect of taxation should it not sit down with the Federation of Canadian Municipalities and get its understanding, its feel and its approval for a piece of legislation before it comes forward? At the very least, should the federal government not inform the FCM that this piece of legislation is coming forward and what the make-up will be of the legislation? It did not happen and I have absolutely no idea or understanding as to why.

We will support the legislation going back to committee. We will support having full, open, honest debate and discussion at committee level. However, we beseech the government of the day to make sure it deals with this piece of legislation honourably and that it puts into place the necessary requirements to make sure that municipalities are treated properly and not with the arrogance that has been seen from this federal government toward the municipalities over the last six years.

[Jean Dubé, Progressive Conservative, Madawaska—Restigouche, NB]

Mr. Speaker, it is a great honour and privilege for me today to be able to speak on this bill.

My colleague said that he used to be the mayor of a municipality. The municipal level is very dear to my heart, for my father was the mayor of the city of Campbellton until his death a month ago. I can therefore say that today's bill is close to my heart, and that is why it is a privilege and a pleasure to speak to it.

In conversations with representatives from the Federation of Canadian Municipalities, the FCM, it is abundantly clear that municipalities and their organizations do not appreciate having the legislation rammed down their throats. Municipalities were not given any advance notice that the legislation was being introduced. No information, no background notes, no news releases, no summaries and no other materials were sent out to these various municipalities. These municipalities are on the front line serving our constituents. They are the front line government and I believe the most important government in our federation.

The municipal governments have not had time to study the bill and respond to it. In the case of the FCM, it has not had time to consult its members on the bill. This begs the question: If this is such a great piece of legislation, what is the rush?

We all know from experience that when legislation is rushed through the House mistakes often get overlooked. Quick legislation is bad legislation. As a member of the House and as a member of the committee, along with my colleagues, that will attempt to clean up the mistakes in the bill, I call on the government to allow more time for the House standing committee to work on the bill and more time for municipalities and other stakeholders to ensure that the legislation will correct past problems without creating new ones.

Speaking of past problems, the very fact that we have a Municipal Grants Act is a bit of an absurdity of history since the government does not officially recognize the existence of municipalities. Towns, cities and local service districts are not mentioned in the constitution. They have no official mandate. They are entirely a creation of provincial governments. Furthermore, the federal government has a constitutional exemption from paying local taxes.

The problem is that the federal government, which owns property in almost 2,000 municipalities across the country, benefits from all kinds of municipal services, such as water and sewage, roads and other infrastructure. Those services are not free. In spite of its constitutional exemption, the federal should pay for those services like every other good property owner in Canada.

This paradox was resolved in 1950 with the passage of the first Municipal Grants Act which has been updated and revised many times, most recently in 1990. Since 1980, there have been a number of issues pop up that the current legislation does not and cannot resolve. This is the basis of the bill that we have before us today.

For example, a couple of years ago, I remember that there was a dispute between the Department of Fisheries and Oceans and local municipalities as to whether the department had to make a payment in lieu of taxes on wharves.

Not too long ago, the federally owned Aéroports de Montréal protested a property evaluation by the city of Dorval. Ottawa re-evaluated the land at $100 million less than the property assessment and told the city that if it did not like it, it could contest the figure before a federal government appointed tribunal.

In my home province of New Brunswick, the provincial department of municipalities estimates how much municipalities will receive from federal payments in lieu of taxes and pays them that amount. The department then goes about collecting the payments from the federal government, but it is only sometime later that the federal government actually pays the amount due and, in some cases, the payment has taken years.

In 1995, the city of Halifax yelled foul when, after increasing the evaluation of the Citadel from $15 million to $36 million, the federal government reduced its evaluation from $15 million to $1.2 million. Short of going to court, the two governments had no ways of resolving this dispute.

In 1992, the Government of Quebec gave municipalities the right to replace all or part of their business occupancy taxes with a new real property tax. The result was a sudden $41 million increase in the federal payments to Quebec municipalities.

In Ontario, the provincial government eliminated its business occupancy tax. To make up the lost revenue, Ontario municipalities increased their commercial real property tax rates by an average of about 45%. These reforms cost the federal government as much as $100 million a year more in payments in lieu of taxes in leasehold occupancy costs. Furthermore, crown corporations are paying approximately $30 million more.

As well, a freeze on payments from 1993 to 1995 made municipal governments mistrustful of the federal government and made the current system unreliable.

Clearly, it is time to update the legislation to deal with these problems that have presented themselves in recent years.

The bill before us today proposes changes in a number of these areas. The bill would change the name of the legislation from Municipal Grants Act to the payments in lieu of taxes act, while references in the legislation to “grants” will be replaced with the word “payments”. This is to better reflect the nature of the program and the relationship between the Government of Canada as a property owner and Canadian and municipal governments.

The bill proposes introducing compensation for late payments by the federal government to municipalities. It also would give the authority to Ottawa to make payments when tenants on federal property default on their local tax bills. These are important changes under which the federal government accepts a position much closer to that of other property owners regarding its tax obligations.

It would establish a dispute advisory panel under the act with a minimum of two board members from each province and territory. The advisory panel would recommend solutions to the minister when disputes arise between municipalities and the federal government over the appropriate amount of payments.

Outdoor swimming pools, golf course improvements, outdoor theatres, residential driveways and employee parking improvements would be added to the definition of “federal property” and the bill would clarify the wording of the act as it relates to a non-building structure.

As well, Bill C-10 proposes to improve the predictability of payments for municipalities by clarifying how payments are calculated for federal farm property and how deductions are calculated when municipalities are unable or unwilling to provide the federal property with equivalent services to those received by similar private property or structures. It would also clarify the status of Parks Canada assets as federal property.

Although the bill does introduce some important changes, there is one important area where I have strong reservations.

Other than section 4 of the bill, which states the intent of the act and which I think is a waste of space as it accomplishes nothing, I would say that 90% of the bill is an improvement over the existing legislation. The important exception is in section 14, which would establish a new dispute advisory panel.

There are two major difficulties with the proposed new panel, the first being one of fairness and balance and the second being the composition of the panel.

Imagine a court trial in which the defendant got to pick his own jury, got to pay the jury and install himself as final judge with no chance of appeal. How would the defendant do? I suspect he would win just about every case. Would we describe this system as fair? I do not think so. Yet this is exactly the kind of dispute settlement panel the minister has proposed in Bill C-10.

Differences in opinion often arise between municipalities and the federal government over how much the crown owes for payments in lieu of taxes. These disputes are often based on the valuation of a property or the definition and classification of a property.

What the minister has proposed is that he should establish an advisory panel composed of a minimum of two persons from each province and territory, for a total of at least 26 members. The members will be chosen only by the minister, and we can just imagine who will be chosen. The minister will decide how qualified the members of the panel need to be. He will pay them $125 per hour plus expenses and they will report only to him.

The minister can fire any of the members of the board at any time for any reason if, for example, he disagrees with their decision. He can completely ignore any decision of the panel if it suits his purpose and his decision is absolutely final. There is no appeal. Not a bad deal. So much for fairness.

On issues related to the composition of the panel, let us look at section 14 in more detail. Subsection 14(1) proposes, as I have said, a panel consisting of no less than two members from each province and territory with relevant knowledge or experience.

My first reaction was that once the bill passes, there will be 26 very happy Liberals across the country who will have brand new patronage jobs. After all, $125 an hour plus expenses is a pretty good day's work.

I call on the other members of the House to support the bill at second reading so we can get it into committee and hopefully fix some of these problems.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I am pleased to rise today to speak to Bill C-10, an act respecting payments in lieu of taxes to municipalities, provinces and other bodies exercising funtions of local government that levy real property taxes.

What does that mean exactly for the ordinary folk? I refer to the bill's summary, which states:

This enactment amends the Municipal Grants Act to improve the fairness, equity and predictability of payments made under the Act. A statement of purpose is included. The enactment establishes an Advisory Panel to advise the minister on disputes concerning payment amounts. It addresses the issues of compensation for untimely payments, defaults on tax obligations by certain tenants of the Crown and the bijural nature of the Canadian legal system. The enactment also makes other amendments of an administrative nature.

The Bloc Quebecois agrees in principle with this bill. And even though we have concerns about some of the points we do not agree with, we will vote in favour of the bill. We disagree on some very specific points. First, on the need to pass this bill in a hurry. We know it has been around for two years. Now all of a sudden it requires urgent attention.

A number of municipalities are currently complaining about being unable to examine this bill in depth and to meet with their member of parliament. I would have liked to meet with the municipalities in my riding—there are 12 of them—to really find out what points bother them. Unfortunately, they are not being given the time to do that, since the government is moving quickly to get this bill passed.

There is also the minister's discretionary power. It is true that such power is found in a number of bills, but I wonder when the government will truly decide to give more power to those directly concerned, in this case the municipalities, and to reduce the discretionary power of the minister who, in the end, is the one who decides and who simply does as he pleases.

I will also talk about the advisory panel—a bogus panel, in my opinion—to which people will be appointed to give advice to the government, not to make any decisions. Also several federal properties are being excluded.

I must say that the new title of the bill is less paternalistic, closer to reality—something which is important to those concerned—and clearer. There is a lot of talk about clarity these days—I will get back to this later on—since, all week, the word clear was constantly being raised during oral question period. It is important to talk about clarity.

It is true that the title of this bill is a little clearer than the former one, which was “Municipal Grants Act”. That title suggested that the federal government was giving grants to municipalities. A grant means a donation or a gift, but that was not the case.

Actually, these grants were used by the federal government to pay for services provided to its properties located on provincial and municipal land. The new title is a little clearer, a little more accurate than the former one, and the minister deserves praise for this giant step.

Judging by the number of times it has used a gag order to cut off debate during the consideration of bills, it cannot be said that this government is always clear. Quite the contrary.

I think that some clarity is in order from this government, which wants so much clarity from the provinces, particularly the Province of Quebec, when it comes to past referendums and referendums not yet held. As recently as yesterday, during oral question period, the Prime Minister was working himself up and saying that he would not negotiate the morning after a referendum if the question was not clear, regardless of the supreme court ruling. Yet this was not what the supreme court ruled.

The supreme court said that it was not up to the Prime Minister to decide whether or not the question was clear. The supreme court ruled that he must negotiate, failing which Quebec could take action.

Speaking of clarity, here is another example. I remember the 1980 referendum, in which Pierre Elliott Trudeau, with the help of his henchman, told us that a yes meant no, that a no meant yes, that Quebecers were telling him they wanted change in the federal system, and that there would be change. He staked his life on it. With the sort of clarity that calls a yes a no and a no a yes, the results are not surprising.

Recently, in the great rally in Montreal just before the 1995 referendum, the present Prime Minister promised Quebecers that he would renew Canadian federalism. “Decentralized federalism” was what he called it. At the present time, we are faced with a centralizing and dominating federalism that no longer even recognizes this founding people, the people of Quebec.

Clarity is something this government was desperately in need of. That is why the minister must be congratulated on at least changing the title of the bill to make it clearer. The new title is less paternalistic and more realistic, as I said, and the Bloc Quebecois agrees with the change. As I have also said, however, the Bloc Quebecois still has questions on certain very specific points.

We have difficulty recognizing the discretionary ministerial power in this bill. Instead of appointing a panel to advise the minister, it would have been easy to give this panel real power.

As has been done in a number of areas, the municipalities could have appointed one person, the government another. These two could have appointed a third and, instead of advising the minister, the panel could have really settled disputes between the municipalities and the federal government. But no, the minister appoints the members of an advisory panel whose role is to provide him with information.

[An hon. member]

A panel made up of buddies.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, as my colleague has said, this panel will very often be made up of friends or of candidates defeated in the last election. The panel will advise the minister, but it is the minister who will have the last word and make the decisions. It is not, therefore, surprising to see so much conflict between the federal and the provincial or municipal levels of government.

Another point that raises questions is all that is not included in the definition of “federal buildings”, for instance: a ) any structure or work that is not a building designed primarily for the shelter of people, living things, plant or personal property or, for greater certainty, any structure, work, machinery or equipment in..., b ) any real property developed and used as a park and situated within an area defined as “urban” by Statistics Canada, as of the most recent census of the population of Canada taken by Statistics Canada, other than any real property acquired pursuant to the National Parks Act or the Historic Monuments Act or any real property that is occupied or used as a park and has been prescribed to be included in the definition “federal property” pursuant to..., c ) any Indian reserve, except for that part of the reserve

(i) that is occupied for residential purposes by an employee of Her Majesty in right of Canada who would not, but for that employment, live on that reserve...,

Follows a whole list of real property the government reserves for itself, perhaps because of the Constitution. However, I think the government could have used this bill to try to put some sort of order in all of this.

Why does it not pay for the services provided this real property? According to the Parliamentary Secretary to the Minister of Public Works and Government Services in her speech at first reading, and I quote: “The government is provided with direct and indirect useful services in exchange for payments in lieu of taxes”. So they recognize that it is really to pay for the services they receive.

Where is the statement found in the bill's summary I read earlier about improving the fairness, equity and predictability of payments?

Why does the government not pay its due to the provinces and municipalities, since we know that, in 5 years, it will have taken $95 billion in surplus away from the provinces and the municipalities? This kind of money is certainly not growing on parliament hill. This money came from the unemployment insurance fund, from cuts to transfers to the provinces, and from higher provincial taxes because of a lack of indexing, not from parliament hill.

The government should have given this money back to the municipalities and the provinces, because they need it to manage and pay the services provided to federal properties. Again, it would have allowed them to balance their budgets.

Instead, the federal government keeps accumulating surpluses and investing the money in new programs it will eventually drop. But the provinces and municipalities will have to pay for and keep providing services which, some day, the federal government will simply drop.

The Prime Minister recently boasted about having surpluses and not knowing what to do with them.

This bill provided the Prime Minister with an opportunity to do something with these surpluses, if only he had given time to the municipalities to come and meet their members of parliament and if he had agreed to really pay for services provided to the federal government by the municipalities.

The Prime Minister had a golden opportunity to return the federal surpluses to the provinces or municipalities, where they are most needed.

In conclusion, we disagree on three major points, namely the discretionary power, the bogus panel that the government will set up merely to exercise its discretionary power, and the whole part concerning real property, properties for which the government could have transferred money to the provinces and municipalities. However, as I said earlier, just because some clarity has been put in the bill and openness was demonstrated on a number of points, the Bloc Quebecois will support the bill.

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, I found it very interesting to listen to some of the criticism by the Bloc of the bill. I have a few questions that I would like to ask in this regard.

It becomes abundantly clear, when one has been in the position I have been in for a number of years, that when funds are collected by the federal government the handling fee, so to speak, becomes very great. I know the Bloc is pushing for a lot of the money to be transferred back to the provinces and so on, but we are talking about municipalities.

Would the Bloc agree that it would be better not to have the money sent to the federal government? Would the Bloc agree that we should leave the money in the municipalities, leave it in the constituencies, and let the people decide the level of tax they want?

We in the Reform Party firmly believe, if we want effective government services, that the closer those services can be delivered to the people the better off they will be. I wonder if the member would agree with that. He talked about the federal surplus. What is wrong with reducing taxes? Why not leave the money in the pockets of the people?

Anyone who has studied this point has come to the conclusion that if we want to create real jobs we have to reduce the tax burden. The biggest tax burden is imposed by the federal government. That would do more to stimulate the economy in local constituencies than anything else.

Would the member agree that the money should be left with the people? We should let the people of Quebec, the people of the local municipalities, decide. A tremendous bureaucracy is developed in the federal government when it is allowed to tax at the level it has taxed, and there is a huge handling fee.

Property taxes in Saskatchewan are a huge problem because two-thirds of the component of property taxes go toward education. This puts an unfair burden on certain groups of people such as farmers who are trying to make a living from the land. Would the member not agree that if a certain level of government such as a provincial government handles education in a province it should be the one to equitably fund it?

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I thank the member for his three questions.

The short answer is yes. I agree with him, and this is one of the reasons the Bloc Quebecois is here now. Since it is impossible to renew this federalism, we have no choice but to work toward the sovereignty of Quebec. Why? Because we feel that the federal system—and I agree with the member on this point—is costing a huge amount of money.

Why collect taxes from the provinces, transfer them to Ottawa and, according to the whim of the federal system, hand them back to the provinces, having taken a small cut? I agree with him 100%.

The other week, the Premier of Quebec said “Give us a federal system similar to that of the European Union and I will go for it immediately”. How does the European Union operate right now? It consists of autonomous governments that give a mandate to the higher organization and pay accordingly. I am in full agreement with such an approach. The provinces should collect taxes and pay Ottawa for the services they receive, as simple.

The federal government is introducing all sorts of services that are costing us a lot of money and doing us no good. This is money that could benefit the provinces.

As the saying goes, if you want it done right, do it yourself. My thought entirely. That is what the Bloc Quebecois is trying to do here, to move this outmoded federal system forward. If this is not possible, the only way left to us to achieve the goals mentioned by my colleague is by working toward sovereignty for Quebec.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, it is very interesting the hon. member suggested that in the end they would support the bill. There are a lot of things in Bill C-10 that I would support. However there are a couple of questions I would like to ask him to clarify whether the hon. member would like to see the bill amended to meet some of the other requirements that ought to be in it.

For example, we are talking about crown corporations. Schedule IV lists all crown corporations that make money and are there for profit. One in particular is the Business Development Bank of Canada. That bank is included as a crown corporation that must pay business tax because it is in the business of making money for the Government of Canada.

Three corporations are also making money for Canada. They are the Canada Mortgage and Housing Corporation, the Canada Post Corporation and the Canadian Mint. These three corporations are excluded from schedule IV. In my opinion they ought to be included because they should pay business tax to the municipalities as do all other businesses in the area. Indeed there are other crown corporations that pay it.

The requirement in the bill is that the minister may pay business tax to municipalities for those corporations listed under schedule IV. Would the member agree that these three corporations—the Canadian Mint, Canada Post and Canada Mortgage and Housing Corporation—should also be included under schedule IV?

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I am totally in agreement with what my colleague has just said.

As I have just said, we are going to vote yes, but with a great many reservations on certain unfortunate points, the very ones he has just listed.

This is why I said that this famous panel ought to have had greater powers, precisely so as to provide the municipalities with support in certain areas.

In my opinion, it is a cut and dried issue. If the federal government has buildings, or receives services in a municipality, then it should quite simply—particularly with the huge surpluses it has—at least pay for the services it receives, just like John Q. Public does.

This would enable the municipalities and provinces to breathe easier and to balance their budgets.

[Benoît Sauvageau, Bloc, Repentigny, QC]

Mr. Speaker, I thank my colleague from Châteauguay for the clarity of his remarks, because this is obviously not a simple bill.

He made frequent reference to clarity. I know that I will have to be brief, because the ten minutes for questions and comments go by quickly.

Before I question him on the bill as such, I would like to put a question to him about the debate currently under way in the House of Commons, especially during oral question period and also in the media, on a clear question for the referendum.

Let me mention in passing that the Prime Minister, who apparently spends more time in the Ottawa area than at his cottage at Saint-Jean-des-Piles, I think, voted in that riding.

If the Prime Minister understood the referendum question in 1995, why, in his opinion, did the other Quebecers not understand it?

My question on the bill before us today is the following. Why does the hon. member think it is urgent to have this bill passed in a hurry, when, in the case of a bill that could help municipalities develop substantial programs for the future—such as the infrastructure program—the government is dragging negotiations on or not beginning them in order to reach a rapid conclusion, instead of one that is expected in December 2000?

My questions are: Why act with all haste with this bill, putting the other issue on cruising speed, and, why, in his opinion, if the Prime Minister understood the referendum question would the other Quebecers not be at least as intelligent as he is and would they not have understood it too?

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I thank my colleague for his two questions. Since I must be quick, let me simply say that, regarding his first question, I am convinced the Prime Minister understood the question very well, as all Quebecers did. Let us not forget that 93% of Quebec voters actually voted in the 1995 referendum.

The Prime Minister understood the question very well and if he had won by 15 or 20 points, he would now be the first one to say that the question was very clear. But he won by 0.4%. And since I now know the number of people who voted at the very last minute, I do not think the federal government really won. This is why the Prime Minister is so intent on setting the rules governing the next referendum.

As for my colleague's second question, I too wonder why we must proceed so quickly. The other day, there was a question in which it was mentioned that municipalities were asking the government to get the infrastructure program going again. Last week, the minister told us that this would not happen until December 2000.

The government is taking its time regarding infrastructures, and yet they are urgently needed. However, as regards this bill on municipalities—and I see that the Chair is signalling to me—I will conclude by telling the hon. member that I too cannot understand why the government is in such a hurry, considering there are so many other urgent things to do.

[The Speaker]

It is my duty to inform the House that there will now be 10 minutes for debate, with no questions or comments.

[Jason Kenney, Reform, Calgary Southeast, AB]

Mr. Speaker, it is always a delight to be invited to speak while Your Honour is in the chair, someone who truly understands the procedures of this place.

I would like to begin by expressing my opposition to the bill before us today, Bill C-10, an act to amend the Municipal Grants Act.

As we have heard, this bill purports to amend the federal government's relationship with municipalities. As we know by the original act of confederation, the Constitution Act, 1867, the federal government and its legal creatures were excluded from having to make tax payments to subsidiary levels of government, namely those of the provinces and the municipalities.

It has been common practice since 1950 for the federal government to assist municipalities in covering the cost of services provided to the federal government and its creatures operating in those places through grants in lieu of taxes or payments in lieu of taxes.

The bill seeks to regularize and modernize the payment of those grants. However, we believe it is filled with loopholes because it provides far too much ministerial discretion, as do so many other bills we see in this place. There is far too much discretion given to the minister and the executive branch of the federal government to choose whether it will make adequate payments and grants in lieu of taxes to municipalities.

Let me begin by saying in principle that we in the official opposition, the Reform Party, believe strongly that municipalities are the first order of government. We believe strongly in the principle of subsidiarity, a principle deeply rooted in political theory, which suggests that the order of government which is closest to the people ought generally to provide the most services; that is to say, proximity to the people who are being served is the best criteria for determining whether a level of government should provide a service. We would tend to place a preferential option on municipalities. We think they are the most important level of government and that generally the role of the federal government should be reduced and minimized while the role of municipalities should be strengthened and upheld.

It is amazing how long it takes for this place and the federal government to work. I understand that this bill originally resulted from a panel of the public works department in 1992, which was an effort to review payments in lieu of taxes. Then it took until 1995 for the joint technical committee on payments in lieu of taxes to do its work. Here we are in 1999, virtually into the next century, before the legislation is actually introduced and acted upon. It has been eight years, with different governments and three parliaments, before action was taken. So often important legislation and important changes are just left to stew in the back rooms and these reports left to gather dust on shelves while we deal with less important priorities.

What really concerns me and my colleagues about the bill is the extraordinary discretion it gives to the minister of public works with respect to payments in lieu of taxes. The bill does not require the federal government to provide payments to municipalities in lieu of taxes. It leaves that up to the minister and his discretion. I refer specifically to the proposed subsection 3(1) of the bill, which states that the minister may, not must or shall:

—on receipt of an application in a form provided or approved by the Minister, make a payment out of the Consolidated Revenue Fund to a taxing authority applying for it—

That is to say, a municipality:

(a) in lieu of a real property tax for a taxation year, and

(b) in lieu of a frontage or area tax

in respect of federal property situated within the area—

If I look at the current act, which this bill seeks to amend, the wording in Bill C-10 is essentially the same. It is almost the same. We will not change the nature of the relationship between the federal government and the municipalities in this respect.

The Reform Party includes in its statement of policies and principles, its blue book, the statement that we will insist that all laws pertaining to individuals and the private sector apply equally to the Government of Canada, its personnel, its agencies and parliament. We believe that this should not be a discretionary matter left up to the whim and will of the minister, but rather we should recognize by act of parliament a positive legal obligation of the Government of Canada to pay for municipal services which it consumes, that it pay its fair share.

Not only does the bill give enormous ministerial discretion, but the bill also fails to include certain agencies and crown corporations of the federal government in Schedule IV of the act. We will propose at report stage or at committee that the schedule be amended so that the Canada Post Corporation, the Royal Canadian Mint, the Canada Mortgage and Housing Corporation all be added to Schedule IV so that they, as creatures of the federal government, be included in the system of payment in lieu of taxes.

It really disturbs me that it is not just in the bill that we see the government's tendency to treat itself to a different legal standard from the standard we impose and expect from other Canadians and other levels of government. For instance, I have a private member's bill on the order paper, which is now No. 29, which is an act to amend the Income Tax Act regarding allowances paid to elected officials. It will be of interest to Canadians to know that the same parliament which is not going to require the federal government to pay its fair share of municipal taxes similarly does not require members of parliament to pay their full share of federal income taxes. Believe it or not, by act of this place we exempt elected officials, alone among all Canadians, from school board trustees to MLAs, MPPs and MNAs, and members of parliament are allowed to exclude one-third of their real income, the equivalent of one-third of their taxable income, from taxes through the so-called non-receiptable expense allowances, which is just an effort to legally avoid the same tax obligation we impose on the rest of Canadians.

If members of this place take out their pay stubs they will see that they are not required to pay the employment insurance premiums which we impose on the rest of Canadians, the same employment insurance premiums which are operating now at a $20 billion surplus, which is allowing the finance minister to pad his budget and cook the books.

We believe, as I said before, that all laws pertaining to individuals and the private sector should apply equally to the Government of Canada, its personnel, its agencies and parliament. That means that we must pay our fair share of municipal property taxes, and Bill C-10 should be amended accordingly.

It also means that members of parliament should pay their full share of income taxes and that all of our regular income from the federal government should be taxable, for full transparency, so we do not treat ourselves to a separate legal standard. It means that we should pay the employment insurance premiums that we impose by power of the coercive law of this place on the rest of Canadians. In fact, if we look at the members of parliament pension plan, there too we have treated ourselves to a different legal standard than is generally available to Canadians through pension plans registered under the Income Tax Act.

In all of these respects parliament should come back to the first principle that we should abide as individuals and as a government by the same laws that we impose upon everyone else.

Mr. Speaker, if you are a municipal property taxpayer, a corporation, a small business or a resident and you fail to pay your full share of property taxes to a municipality, there are legal sanctions. You could have that property taken away from you. If the federal government refuses to do so, if the minister fails to use his discretion, there is no sanction which those municipalities can impose upon us.

I call upon parliament to abide by the same law we impose on the rest of Canadian society.

[Paul Forseth, Reform, New Westminster—Coquitlam—Burnaby, BC]

Mr. Speaker, it is a privilege to speak to Bill C-10, as it universally affects most Canadians, for we have become a nation of city dwellers, living within highly organized municipalities. Within these political city or municipal units the federal government and its crown corporations have vast holdings of land and improvements which are not subject to local municipal taxes. Nevertheless, the federal government began making payments in lieu of property taxes in about 1950, following years of persistent representations by the Federation of Canadian Municipalities. With 63,000 buildings and parcels of land the Government of Canada is the country's largest municipal property owner. The federal government makes payments in lieu of taxes to some 2,200 local governments.

There is a long history to the rule that a lower order of government does not tax the higher one. Municipalities are the creation of the provinces and certainly within their powers they have not been given the ability to tax federal lands and buildings, such as a local armoury or military base. This bill will amend the Municipal Grants Act, at it is claimed that it will improve the fairness, equity and predictability of payments made under the act from the federal government to municipal governments.

The enactment establishes an advisory panel to advise the minister on disputes concerning payment amounts. It addresses the issues of compensation for untimely payments when the bureaucracy cannot get its job done on time, perhaps if there is an interpretation dispute or when there is a default on tax obligations by tenants of the crown.

Although its property is exempt from taxation under the constitution, the Government of Canada, through this bill, accepts the responsibility to pay a portion of the cost of local government in communities where it owns property.

In 1950, at the pleading of the Canadian municipalities, the government established a program of payments in lieu of taxes. Federal agent crown corporations also make payments in lieu of taxes and the corporations themselves manage the payments.

The point of tension between municipalities and the federal government has been longstanding in this area. The bill attempts to improve the practice of giving money instead of submitting to local taxation.

In one section of the bill the minister is given the authority to pay interest on payments in lieu of taxes if it is in his opinion that a payment in whole or in part has been unreasonably delayed. Through regulatory instruments and amendment to the crown corporations grants regulations, crown corporations may now make supplementary payments for payments that are unreasonably delayed. Is it not nice of them to be so benevolent?

Of course there is no legal requirement to pay or set penalties for not paying on time. Municipalities have such authority for the lowly homeowner, but the federal government would never submit itself to the same standards, especially to pay the full going rates of everyone else. There is no change here. The government is able to set its own property values and pay lower property taxes than might otherwise be levied.

The government also leases some of its property to non-departmental third parties. In the past, municipalities have experienced some difficulty in collecting property taxes from some of these third parties, with payments sometimes never being made. To correct the situation Bill C-10 proposes that if after the last day of the taxation year all or part of the taxes remain unpaid and if in the opinion of the minister the taxing authority has made all reasonable efforts to collect the taxes and there is no likelihood that the authority will ever be able to collect, then the property will be deemed to be an operational federal property and the government will pay the benevolence payments, for that is what they still are. The bill is very clear that there is no power to tax and no rights are created. However, the government says through Bill C-10 that it will be benevolent.

It is good that the bill proposes to include some structures and improvements that used to be excluded from payments, such as crown corporations. Schedules III and IV of the Municipal Grants Act outline the crown corporations that are eligible to pay benevolence payments if they do not pay real property tax or real business occupancy tax. Those contained in Schedule IV are corporations involved in profit oriented activities and may therefore pay both property and business occupancy related assessments.

The joint technical committee on payments in lieu of taxes recommended that the Canada Post Corporation and the Royal Canadian Mint be added to Schedule IV, but surprise, surprise, they do not appear in the bill.

In the private sector disagreements about property values are handled through a formal appeal process and the decisions are binding on both parties, but in the case of the federal government this process is not used.

The value is used to calculate payments or to determine under federal authority the one who pays, and not within the jurisdiction of provincial and territorial tribunals. Would private companies not love to set their own rules for how much they are going to charge themselves for property taxes?

In 1983 to give municipalities a way of redress when they disagreed with the amounts of the payments in lieu of taxes, the minister established a municipal grants review committee, MGRC. This panel provides the minister with advice on the resolution of disputes between taxing authorities and the department concerning the valuation and classification of federal property. The decisions of the MGRC are given in the form of recommendations which the minister is not obliged to accept. This has given the municipalities the impression that the process is, to say the least or charitably, biased against them. It certainly is not a full independent delegated authority like a municipal board of referees for residential assessments.

Bill C-10 simply puts into legislation the status quo that was implemented in 1983, with the minister hand selecting the advisory panel from at least two members from each province and territory. The federal minister also appoints the chairperson from those members. Sadly, the recommendations are non-binding.

In summary the bill has some merit but warrants improvements, particularly regarding payments by crown corporations with the inclusion of the Royal Canadian Mint, Canada Post Corporation and Canada Mortgage and Housing Corporation in schedule IV to make them eligible to pay business occupancy payments in lieu of taxes. Additionally the minister and crown agencies maintain too much discretionary power. Reform has said for years “The Reform Party will insist that all laws pertaining to individuals and the private sector apply equally to the Government of Canada, its personnel, its agencies and parliament”.

Bill C-10 still provides for ministerial discretion as to whether or not payments will be made by the government and there is no binding means of recourse in the event of a dispute. This is not the case for the private sector where the payment of property and business occupancy taxes are mandatory and the decision of appeals are binding on both parties. The Government of Canada and its crown agencies still maintain their privilege.

The Liberal government has been verbose on the accomplishments of this bill. I do not need to repeat them. On the disappointment side, the minister and crown agencies maintain too much discretionary power. Recommendations of the dispute advisory panel are non-binding. It merely maintains the old ways of behaviour and entrenches into legislation the common practices that were put in place about 16 years ago. The Royal Canadian Mint, Canada Post Corporation and Canada Mortgage and Housing Corporation should be added to schedule IV in order that they may be eligible to pay business occupancy payments in the municipalities where they reside.

I give the final word to the Federation of Canadian Municipalities. More often than not, the Reform Party has a better idea because we listen and strive to be accountable. We have a clear notion of whom we are working for, unlike the Liberals. The federation said about legislation on federal payments that the Bloc, Liberals, NDP and PCs were all on probation on this count as their policies did not make the grade. Municipalities have maintained that the federal government has an obligation to pay its portion of property taxes like everyone else.

The Federation of Canadian Municipalities gives some credit to the Liberals for their efforts to negotiate improvements to the program, but it still places them on probation for failing to make an explicit commitment to respect future provincial taxation principles. However, the Reform Party passes its examination with our commitment to legislated accountability and to subject the federal government to the same general tax laws as everyone else.

With Bill C-10, the Liberals again show that they are slow to change. I hope they will permit sufficient amendments at the committee stage to fully respond to the Canadian public agenda of reforming and renewing the federation.

[Garry Breitkreuz, Reform, Yorkton—Melville, SK]

Mr. Speaker, I would like to make a few brief comments before the debate on this bill is over.

I have looked at this bill and have done some studies on my own. I asked some questions of the lawyers who do research for us in this esteemed place. I asked them to examine some of the recent legislation in the House to find out which of those pieces of legislation take powers away from parliament and give them to the bureaucracy. They had never been asked a question like that. They were absolutely astounded when they finished examining the first six pieces of legislation and found that in every single instance it was taking power away from parliament and giving it to the bureaucracy. This bill is not any different.

One of the real problems the Reform Party has with what is sometimes called a housekeeping bill or legislation that is very innocuous is that it maintains or increases the power of the bureaucracy. That is the biggest problem we have with this bill.

One Reform Party policy states very clearly under the topic of parliamentary reform that we believe and insist that all laws pertaining to individuals and the private sector apply equally to the Government of Canada, its personnel, its agencies and parliament. That is one of the things the Reform Party stands for.

Bill C-10 still provides for ministerial discretion as to whether the payments in lieu of taxes will be paid by the government. There is still no binding means of recourse in the event of a dispute over payment. The power still lies with the federal government. This is not the case for the private sector where the payment of property and business occupancy taxes are mandatory and the decisions on appeals are binding on both parties.

The Government of Canada and its crown agencies maintain privileged positions. They are not relinquishing that in any way, no matter what the appearances are in this bill. That is a concern to us. That should be fixed with the proper amendments.

There are some good things in the bill. The interest may now be paid on late payments. Payments may be made on federal properties leased to third parties, if at the end of the taxation year they are still in a state of delinquency. Some types of structures, for example, outdoor swimming pools, golf courses and outdoor theatres have been added to the definition of federal property. There is an advisory panel that serves as a committee of appeal regarding payment disputes with crown corporations.

However, there are problems that need to be fixed. One of the things we have a problem with is that the minister and the crown agencies still maintain too much discretionary power. In other words, they can still do as they wish. Why not fix that? People should know what the rules are. Everyone in the country should follow them.

The recommendations of the dispute advisory panel are non-binding. Why not? It merely maintains the status quo and entrenches some common practices into legislation that were put in place 16 years ago. If something is broken and there is an opportunity to fix it, why not fix it? That is what should happen in this legislation.

As my hon. colleague for Kelowna has mentioned, the Royal Canadian Mint, Canada Post Corporation and Canadian Mortgage and Housing Corporation should be added to schedule IV in order that they would be eligible to pay business occupancy payments in lieu of taxes.

We recommend that these problems with the bill be addressed.

I would like to review the purpose of the bill. The purpose of the legislation is to provide for fair and equitable administration of payments in lieu of taxes. It addresses the issues of compensation for untimely payments, defaults and tax obligations by certain tenants of the crown and the bi-jural nature of the Canadian legal system.

Additionally, it establishes an advisory panel to advise the minister on disputes concerning payment amounts. It also amends the title of the act to payments in lieu of taxes act. That is the essential purpose. Anybody watching this should know what is going on here.

I will mention one of the things I mentioned previously when I rose to ask some questions because it is of great concern to my constituents. When it comes to administration of some of the things within government, and it is not strictly tied to this bill, the services should be delivered by the agencies closest to the people. They should have more control over the tax burden that those people experience. At the present time the federal government has a tremendous power to tax.

One of the legitimate concerns that my colleagues in the Bloc have is that the federal government overrides the jurisdiction of the provinces. I do not sympathize very much with what the Bloc members have to say, but in this respect they make a good point that we have a federal government that intrudes into many areas.

For example, one area I am very familiar with is gun control. I know my reputation precedes me, but I think this is an opportunity for me to raise the issue when we are talking about municipal and provincial levels of government in relation to the federal government. This is an area where the federal government clearly intrudes into areas of provincial jurisdiction and it does it in devious ways. By going through the Criminal Code of Canada it can override the jurisdiction of the provinces in regard to regulation of property.

Bill C-10 is another example of that. We have to put some restraint on the bureaucracy in Ottawa so it cannot ride roughshod and arbitrarily over the rights of some of the municipalities in relation to some of these things. Mr. Speaker, I gather by the way you are listening very carefully, that probably nobody has made that point in the debate so far.

I have a concern that the federal government collects huge amounts of taxes. It collects them through some of its crown agencies, three of which I have previously mentioned. We have a concern that the government is collecting taxes when it should not be. It charges a huge handling fee for this kind of thing. The people purportedly to whom the service is given do not reap the full benefit they could, judging by the tax burden that they are under.

I want to raise one other issue which does not tie in directly, but many farmers in my area are very concerned with the municipal property tax and the way it is administered. Much of this is a provincial matter, but it gives me an opportunity to say that there is an unfair tax put on farmers. It is the education tax that is tied in with the property taxes. Perhaps that is something we should urge the federal government to speak up on.

I am pleased to have had the opportunity to make a few comments in regard to this bill. While I would like to share my time with my colleague from Wild Rose, I understand I cannot do that. I will therefore end my speech and hopefully there will be some time for him to make a few remarks as well.

[Elsie Wayne, Progressive Conservative, Saint John, NB]

Mr. Speaker, I have grave concerns about Bill C-10 and I will explain why.

Having been the mayor of Saint John for four terms, I always stated and still do that the local government was the government of the people. The grassroots people are there. Always, as far as I am concerned, the federal government should pay its taxes as well as all of the others in the private sector.

I look at what we have in our port. The federal government cut back on its taxes and it was going to give us a grant in lieu of them. The grant was going down, not going up. Taxes were going up for everyone else but the federal government.

The Federation of Canadian Municipalities, of which I sat on the board of directors, was very upset with the bill. It was upset at the speed at which the bill was being rammed through the House. It was not given any advance notice that the bill would be introduced.

The Federation of Canadian Municipalities represents all municipalities across the country. It is the one that does the research to see what should be the priorities, where we should be going, whether it is the provincial government or the federal government, and in which direction. It has not been adequately briefed on the bill and it was not sent a copy of the bill or the background briefing materials. It has also not had time to consult with its members across the country.

I cannot believe that we have really done this. The local governments and all the municipal governments represent all their people at the grassroots. They should have input and they should have had input into this bill.

When I look at the proposed new intent clause, clause 4 of the bill, I say to myself that this is a meaningless piece of propaganda and adds nothing of value to the bill. We have two major difficulties with clause 14 of the bill, the proposed new dispute advisory panel, its composition and fairness.

I think it is great that we are talking about setting up a new panel of a minimum of two members from each province and territory. However, it should be the Federation of Canadian Municipalities that decide on who the members will be because it does not play politics. It keeps politics out of it. The president of the Federation of Canadian Municipalities should come in and give the minister two names from each province and the territories. Not one of those people would want $125 an hour.

[An hon. member]

A day.

[Elsie Wayne, Progressive Conservative, Saint John, NB]

A day? This one says an hour. I do not care if it is a day or what it is, not one of them would ask for that. I cannot believe we are doing this.

With the federation of municipalities wanting to deal and co-operate with the federal government, more than likely its members would ask only for their expenses to be paid. They probably would ask for no remuneration whatsoever. But no dialogue took place with them on this issue.

The bill requires members to have relevant knowledge or experience but it does not define that term. If we want relevant knowledge or experience at the local level, all we have to do is take some mayors and councillors—and it does not matter if they vote Liberal or not—and put them on that committee. Perhaps it might be better if they did not vote Liberal. We might then be able to have someone with an open mind.

Presumably relevant knowledge or experience could mean any person who is a member in good standing of the Liberal Party, which concerns me a little bit. It would be much better, as I have stated, if the members were required to be a certified member of a professional organization as well. There are a lot of them who are members of the Federation of Canadian Municipalities.

I would not mind if the bill would allow public servants, including municipal employees, to serve on the panel, but I do not want them to be in a conflict because they are hired by the mayors and councillors. If they come back with a recommendation that is in conflict with what the mayors and councillors of the municipalities where they work are feeling on certain issues, then it would make it most difficult for them. I must say that at the local level we do have some very qualified people whose input could be used. When I look at the panel that is one of the major concerns I have.

There are two major concerns. I feel very strongly that the federal government should be paying taxes just the same as the private sector and everyone else. It should pay its taxes just the same as my family pays their taxes. Why should it be any different? It is the same as the provincial governments paying their taxes. If we were able to make everyone feel equal and feel that no one was getting any special treatment, the local people would have a better feeling about this issue.

The panel is supposed to be appointed by the minister. The panel will be paid by the government. The panel reports only to the minister and its decisions are not public.

I cannot believe we are bringing in a bill like this. If the bill does come in then the recommendations should certainly be made public. The next thing we know secret letters will go out to everybody else and somebody will get a copy that was not supposed to be made public. If we make it public it will not look like we are hiding anything.

When it says that the panel serves at the pleasure of the minister, which means the minister can say “I do not like what you have brought in so I am going to remove you and put somebody else in there”, that worries me as well.

We are very much in favour of some parts of the bill, but there are concerns, and I feel very strongly that those concerns should be addressed. There is no question that there should be changes.

We also talk about grants in lieu of taxes. These are difficult times on the Hill because once again the government has seen fit to spend the money, perhaps in an irresponsible way, but the next thing we know the grants could be eliminated in lieu of taxes and nothing would be there for the municipalities. What would happen then? The local governments would have to raise their taxes to make up for what the federal government would not be giving.

I have a major concern with the federal government telling me and all Canadians that it will give us grants in lieu of taxes. This tells me that it does not want to pay the full tax.

The concerns that I have are concerns that my party has. We would like to see a legislative review. If that panel is put in place by the minister and he makes these appointments from all across Canada, we want to see a legislative review of the panel after five years to see if it is working well and to allow the House to make any changes that are necessary.

When we talk about setting up and paying someone $125 a day plus expenses to sit on a committee, this is when people in Canada get very discouraged, they truly do. When we are at the local level, we get very discouraged with that. That is not necessary.

As I stated earlier in my remarks, this should go to the Federation of Canadian Municipalities. This should all be tabled until the Federation of Canadian Municipalities has been able to sit down, discuss this and have its total input into the bill.

I think this is probably the only government that has been in power that has never sat down with the president and the board of directors of the Federation of Canadian Municipalities when dealing with issues like this. I cannot believe that the Liberals talk about grants in lieu of taxes when they have not even had the input from those at the local level whom it will affect.

As far as the bill goes, I feel very strongly that it should be tabled until that input is there and until we hear back from the Federation of Canadian Municipalities as to whether or not it is in support of it or whether or not it feels there should be changes.

[Myron Thompson, Reform, Wild Rose, AB]

Madam Speaker, I am pleased to speak to this piece of legislation today.

I thank my hon. colleague from the Conservative Party for reminding me about the problems that we used to have as mayors at the municipal level, local level and grassroots level, the problems that we had for a number of years. I can certainly share those beliefs and those words with my colleague.

It is true that it has been happening for a number of years, including when federal governments were operated by both Liberals and Conservatives. Those are the parties that have been operating the government over the last number of years, and nothing has really changed in that respect. It certainly is time for some changes and there are some fairly decent changes that are brought about in the bill.

I really have a difficult time understanding why this particular government has a problem with trying to implement something equally across the system. Equality seems to be a word that is truly absent from its vocabulary.

It is my understanding that the Federation of Canadian Municipalities has not had one speck of input into what is going to happen to their jurisdictions as a result of the bill. A number of mayors and councillors are wondering what this is all about. Suddenly the bill is here zinging through the House of Commons and will become law before they even know how it will affect them.

This is another process that needs change. This is a process that constantly seems to prevail in this place where we know best and why should we bother conferring with other levels of government that will be affected by these pieces of legislation. I find that thoroughly disgusting and yet I am not surprised.

Having been in the House for six years, I have seen the amount of power that is handed over to the bureaucracies, as it will be done in this case. I have seen a number of bills that include the words “by order in council”, “given ministerial discretion” and “full power” over many issues. Once upon a time, the idea of “by order in council” was for emergency situations, but it now appears in all legislation so many times that it is really scary.

If I am not mistaken, in Bill C-68, which we recently debated, the words “order in council” were used 74 times in that one piece of legislation alone.

The municipalities have to sit back and wait to see what the great central government in Ottawa will come out with and how it will affect the things they have to deal with.

When I was the mayor of my home town, I recall a couple of property owners wanting to subdivide their land and build a house and a quonset. They brought all the information to the local council. I, as mayor, and six councillors looked at the proposal. We studied it carefully, discussed it with other residents of the community and decided that it was a good deal and should work without any difficulties.

However, lo and behold, there was another level of government, the provincial government, which had not even seen the situation, was not aware of the situation had not discussed it with anybody, had only looked at a little drawing of what we were talking about when we had to get some authority to go ahead with this, and it flatly denied the proposal.

It was then that I had the opportunity to bring these people into town through a challenge that I would pick them up and bring them in. I told them that they had no business making decisions without at least looking at the situation. Once they got out there and had a word with the people, and once they saw with their own eyes what they were talking about, they were able to make some changes and allow it.

The problem we have in this place on a higher level, when these kinds of things come down, is making sure the power remains in the hands of the minister, the ministerial discretion, the federal government almighty power, and making sure the bureaucracy is loaded up with power galore. So we operate in a very difficult situation.

I have to ask myself “What's new”? The democratic process in the country does not exist in this place. We just voted on a motion asking for a referendum on the Nisga'a agreement. The mighty upholders of democracy, the believers in letting the people have a say, could not even support letting the people of British Columbia have a voice. Worse yet, aboriginal people living in British Columbia have been phoning my office day in and day out asking me to encourage the government to let them have a voice because there is no accountability on many of the reserves. These people are suffering and hurting. Yet, things are rammed through without any regard for the people themselves, without any thought about the effects it will have.

What kind of a situation will we be in with the Nisga'a agreement when they become a municipality or self-governing? Will the rules apply in their situation in the same way as they do in small towns in Alberta or large cities in Ontario? Will there be equality? It is very difficult to say, but it is obvious to me that past history says that people should beware, wherever they live.

The government does not truly believe in a democratic process. Its members emerge for a vote in this place from behind closed doors after a private discussion among members of their party. Then they vote according to what the leader of their party happens to say. Their leader happens to be the Prime Minister of Canada and the puppets will obey the rule. They will vote according to what he says, and never mind what they are told in their constituencies or what people at the grassroots level have to say. They do not dare to cast a vote which does not express the view of the Prime Minister if they want to be part of the government.

If that is democracy we truly need some serious changes. I would like to see democracy reflected in bills such as Bill C-10 but it is not reflected. I would like to see it reflected in the agreements we make with our native people, the treaty agreements that have been made and the ones that will come up. Where is the voice of the people in all these things? Where does the power ultimately lie? The power of any real democracy should lie in the hands of the people. It is difficult to say that it is happening in Canada. There are too many examples that tell me it is not the case.

We have a bill before us today that gives ministerial discretion, a great power, to the federal government and to a huge bureaucracy. A panel is to be set up. We do not know for sure how the panel to observe all this will be set up, but we can almost bet it will be full of patronage.

Good old friends of the Liberal Party will make sure to fill those high places. They will serve on the panels because their view is that those of us who are not Liberal, who do not vote Liberal, are not smart enough to know what we are doing. We cannot let that happen, not in Canada.

Their attitude with regard to all kinds of legislation going through here is sad. We are at second reading stage of this bill and the fact that municipalities throughout Canada and the Federation of Canadian Municipalities have not even had an opportunity for input is a real shame.

I say shame on the federal Government of Canada, the leaders of this great nation, that it continues to bring forward legislation in this place and does not allow the real leaders of the land, the people, to have a true voice. That has to change, and may God grant it soon.

[The Acting Speaker (Ms. Thibeault)]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker (Ms. Thibeault)]

The House has heard the terms of the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.